Sex and Innovation

Annalee Newitz at eTech 2005 talked about some interesting facts: how sex drives innovation. The Silicon Valley Watcher gives an account of this:

She starts with the equation: "Everybody wants porn + nobody will admit it + everybody loves tech = innovating ways to look without being seen.". She starts with talking about how yesteryear's vibrators were a kind of camouflaged technology. "I only use it for therapeutic purposes," reads an ad from 1910.(...) One of the driving forces behind VCRs was the porn industry. The VCR became a way of camouflauging porn consumption. Before 1976 you had to go to a theatre -- local people knew you were going to theaters -- a very public experience. Now people could watch dirty movies in their own homes. (...) "Porn built the Internet. It's such an obvious use of the medium; because it's so private and widely available"

Yup, sex, as well as video games and militarty stuff appear to be what drives tech innovation...

Farming out R&D?

A great issue of Business Review about how western companies are more and more outsourcing R&D, creating a new model of innovation.

CEOs are asking tough questions about their once-cloistered R&D operations: Why are so few hit products making it out of the labs into the market? How many of those pricey engineers are really creating game-changing products or technology breakthroughs? "R&D is the biggest single remaining controllable expense to work on," says Allen J. Delattre, head of Accenture Ltd.'s (ACN ) high-tech consulting practice. "Companies either will have to cut costs or increase R&D productivity."

The result is a rethinking of the structure of the modern corporation. What, specifically, has to be done in-house anymore? At a minimum, most leading Western companies are turning toward a new model of innovation, one that employs global networks of partners. These can include U.S. chipmakers, Taiwanese engineers, Indian software developers, and Chinese factories. IBM (IBM ) is even offering the smarts of its famed research labs and a new global team of 1,200 engineers to help customers develop future products using next-generation technologies. (...) HTC? Flextronics? Cellon?...Quanta Computer, Premier Imaging, Wipro Technologies (WIT ), and Compal Electronics, are fast emerging as hidden powers of the technology industry. (...) Motorola hired Taiwan's BenQ Corp. to design and manufacture millions of mobile phones. But then BenQ began selling phones last year in the prized China market under its own brand. That prompted Motorola to pull its contract. Another risk is that brand-name companies will lose the incentive to keep investing in new technology. (...) Still, most companies insist they will continue to do most of the critical design work -- and have no plans to take a meat ax to R&D. (...) . "Companies realize if they want a sustainable competitive advantage, they will not get it from outsourcing," says President Frank M. Armbrecht of the Industrial Research Institute, which tracks corporate R&D spending. (...) Companies also worry about the message they send investors. Outsourcing manufacturing, tech support, and back-office work makes clear financial sense. But ownership of design strikes close to the heart of a corporation's intrinsic value

The paper adresses the risk and the future of this kind of practices. It's full of examples and very relevant.

And Samsung became Sony

IHT:In 1997, Japan's premium electronics company took little notice of Samsung Electronics, a South Korean television maker fighting a life or death battle to survive the Asian currency crisis. Less than a decade later, Samsung has twice the market capitalization of Sony. (...) Samsung also has a huge capacity to build raw components like memory chips and display panels, lowering production costs. Samsung was once a back-of-the-store brand with bulky televisions and boom boxes. After the Asian currency crisis, Samsung upgraded its product lines to compete directly with Sony for the premium market, leaving cheaper electronic goods to new companies in China. (...) "Samsung is like the old Sony," said Gilder, who edits the Gilder Technology Report. "Samsung has much of the spirit of Sony 10 years ago."

More and more creative customer

The Economist has an appealing column about the rise of creative customers: "how and why smart companies are harnessing the creativity of their customers". Some excerpts I find informative:

How does innovation happen? The familiar story involves boffins in academic institutes and R&D labs. But lately, corporate practice has begun to challenge this old-fashioned notion. Open-source software development is already well-known. Less so is the fact that Bell, an American bicycle-helmet maker, has collected hundreds of ideas for new products from its customers, and is putting several of them into production. Or that Electronic Arts (EA), a maker of computer games, ships programming tools to its customers, posts their modifications online and works their creations into new games. And so on. Not only is the customer king: now he is market-research head, R&D chief and product-development manager, too.(...) This is not all new. (...) But the rise of online communities, together with the development of powerful and easy-to-use design tools, seems to be boosting the phenomenon, as well as bringing it to the attention of a wider audience, says Eric Von Hippel of the Massachusetts Institute of Technology, who is about to publish a book, “Democratising Innovation” (MIT Press). (...) DIY innovation [vow I like this concept] (...) Traditionally, firms have innovated by sending out market researchers to discover “unmet needs” among their customers. These researchers report back. The firm decides which ideas to develop and hands them over to project-development teams. Studies suggest that about three-quarters of such projects fail. Harnessing customer innovation requires different methods, says Mr Von Hippel. Instead of taking the temperature of a representative sample of customers, firms must identify the few special customers who innovate.

Well, marketing and user centered studies are more and more mixed all together and customers/users' needs are more and more took into account! There is really a strong momentum here...

Most admired companies and innovation

Nice paper in Fortune about what it takes for admired companies to innovate. Hay Group polled executives at 160 companies on the subject of innovation and fortune gives us some results:

Most companies know innovation when they see it: Sony launched the age of portable music with its Walkman; FedEx transformed the package-delivery industry with its hub system; Procter & Gamble created fluoride toothpaste, among other household products that are now indispensable to modern life.(...) That mindset includes knowing which innovations to focus on and how much time to devote to each. (...) And it requires having the right people in the right places—both motivated employees and managers who can encourage them.(...) Companies admired for innovation are also more likely to invest in research and development. (...) nnovation leaders are also more likely to have clear procedures for determining the level of investment; more likely to be patient in allowing new ideas to develop; and more likely to allow ideas to fail without penalty. But when it comes to appreciation and remuneration, both the innovation leaders and the peer group have a way to go. (...) Innovation isn't something confined to a company's R&D unit. It's a mindset that permeates an organization. Successful innovation requires more than brilliant scientists. It takes leaders, entrepreneurial spirit, great ideas, good management, and the right organizational structures.

They might forget the right network, connections...

MIT admirers in Europe plan rival

According to the Financial Times, there should be a European Institute of Technology based on the MIT model:

European commentators frequently mention MIT as the best model of an institution that carries out world-class research and teaching in science and technology, while maintaining strong links with industry and spinning out lots of innovative small companies.

The latest - and most powerful - endorsement came last month from José Manuel Barroso, the European Commission president, who called for the creation of a European Institute of Technology modelled on MIT, as part of the EU's new jobs and growth strategy.

Well... it's always the same story... trying to copy the big neighbor (Route 128 + Silicon Valley)...

Much more interesting is the proposal from the European Commission (via)

to double European research funding in the next financial perspective (2007-2013) and highlights that this significant boost at European level needs to be accompanied by increased research spending at national level. In addition, more emphasis should be put on radical innovation and risk-taking. More industry participation, especially SMEs, and streamlined and simplified administration are also strongly encouraged.

Open Source Community Building

A very neat masters thesis project via Hannes: "Open Source Community Building." by Matthias Stuermer (University of Bern).

Building an active and helpful community around an open source project is a complex task for its leaders. Therefore investigations in this work are intended to define the optimum starting position of an open source project and to identify recommendable promoting actions by project leaders to enlarge community size in a healthy way. For this paper eight interviews with committed representatives of successful open source projects have led to over 12 hours of conversation about community building. Analysing the statements of these experienced community members exposed helpful activities that led to the presently prospering communities of their projects. Summarizing the conclusions of this qualitative research a table with conditions for successful open source project initialisation and a subject-level promotion matrix of community building could be created. They include suggestions o­n how to start a new open source project and how to improve and increase the community of an already advanced open source project.

Hannes points on the do's and don't:

1. Do it for yourself.
2. Don't loose yourself in perfectionism.
3. Do accept others ideas and work, too.
4. Do communicate openly.
5. Don't speak of ideas but contribute solutions.
6. Do behave nicely.
7. Do serious marketing.

I am concerned with innovating communities and since I am looking for evidences of non-institutional R&D project (a potential paper I definitely do not know where to publish). I like that kind of work! Enquiries about innovation management is of tremendous interest. Understanding such kind of processes in countercultural organisations (squats, independent music label...) might also sound god